EXHIBIT 12 MUZAK LIMITED PARTNERSHIP COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (DOLLARS IN THOUSANDS) Eight months Four ended months Year Ended Year Ended Year Ended Year Ended August 31, ended Dec. Dec. 31, Dec. 31, Dec. 31, Dec. 31, 1992 31, 1992 1993 1994 1995 1996 ---------------------------------------------------------------------------- EARNINGS: Net loss attributable to general and limited partners ($5,975) ($656) ($4,047) ($8,116) ($6,743) ($11,739) ------- ------ -------- ------- -------- --------- ADD BACK FIXED CHARGES: Interest expense including amortization of deferred financing costs 3,639 1,228 3,785 6,990 7,483 8,112 Preferred returns -- 188 572 933 1,029 916 Assumed interest component of rent expense (1) 1,064 546 1,863 2,128 2,566 2,584 ------- ------ -------- ------- -------- --------- Total fixed charges 4,703 1,962 6,220 10,051 11,078 11,612 ------- ------ -------- ------- -------- --------- Adjusted earnings ($1,272) $1,306 $2,173 $1,935 $4,335 ($127) ======= ====== ======== ======= ======== ========= Ratio of earnings to fixed charges (0.27) 0.67 0.35 0.19 0.39 (0.01) ======= ====== ======== ======= ======== ========= Deficiency of earnings to fixed charges $5,975 $656 $4,047 $8,116 $6,743 $11,739 ======= ====== ======== ======= ======== ========= <FN> - --------------------- (1) Estimated as one-third of operating lease expenses </FN>